Nay Pyi Taw, July (2)
The military chief, who spends the majority of the state’s budget on the defense sector, has called for the people to practice austerity in order to reduce the local and foreign currency deficits.
At the State Economic Cooperation Meeting on June 30, the junta leader gave directives to limit spending except on essentials, avoid waste, spend wisely, and reduce the deficit.
The military leader admitted that the country has had a foreign trade deficit for many years due to poor production and a lack of sales, and that the need for foreign currency has risen.
He added that the need for foreign currency was solved through international grants and loans during the first and second terms of the democratic government. Under the military regime, they faced international sanctions, restrictions on the use of existing foreign currency, and bans on the sale of goods.
An economist said, “The military council’s directive is trying to achieve trade surplus, and because all the people are currently struggling, it should be done first to settle the livelihood of the people at the bottom of society rather than the issue of reducing the trade deficit. The private sector, SMEs, and foreign investment have not yet recovered”.
Analysts believe that the present military council should take steps to raise the value of Myanmar’s currency and withdraw unnecessary import and export restrictions.
“Under the first term of the democratic government, the country’s economy grew by more than 8 percent due to the influx of foreign investments, but there was a slight decline in the last year. Economic growth was strong during the second term of the democratic government, but declined again in the third term,” said the military leader.
In addition, Major General Min Aung Hlaing gave the excuse that in the 2019–20 fiscal year, the country’s economic growth rate was only more than 3 percent, and has shown negative signs during his tenure.
Myanmar’s businesses have suffered since the outbreak of COVID-19, and the situation has gotten worse since the coup, according to a businessman.
The World Bank announced on June 27 that Myanmar’s economic activity is slowly increasing and that GDP is projected to increase by 3% in the year to September 2023.
Myanmar’s economy, which has deteriorated since the military coup, has yet to recover, and the wrong policies, according to experts, might permanently affect the country’s economy.
The fiscal deficit is estimated to have widened to 5.4% of GDP under the military regime, according to the World Bank.
News-Than Lwin Times
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